Germany Chancellor plans lithium deal with Serbia after Rio ruling
Olaf Scholz plans to visit Serbia this week to secure supplies of lithium that are critical for the nation’s energy transition and auto industry.
Canada Lithium Corp (TSE:CLQ) shares were marked down more than 8% on Tuesday on massive trading volumes, after announcing bought-deal financing that investors thought were selling the company cheaply.
The Toronto-based company announced it had entered into an agreement with Dundee Securities to purchase on a “bought deal” basis 5.21m flow-through common shares at $0.48 and 25m units at $0.40 for gross proceeds of $12.5m.
Apart from valuing the offer below the ruling price which is common in these type of deals, the terms of the deal appears quite generous.
The units are made up of one common Lithium Canada share and one-half of one common share purchase warrant which entitles holders to acquire one share at a price of $0.50 for three years. Dundee Securities also has the option to purchase an additional 15% of the offering, in any combination of flow-through shares or units.
By early afternoon the miner was trading down 8.3% at $0.44 on the Toronto big board, at its lows for the day.
A whopping 6.8 million shares in the $163 million company had changed hands by 1pm EST on Tuesday compared to the daily average of just 450,000.
Canada Lithium is showing steep losses for 2013 – it is down 32% year to date.
The company is expected to start full operations at the end of October after suspending the commissioning of its open pit and processing plant near Val d’Or, Québec for three weeks.
Canada Lithium’s mine has a design capacity of 20,000 tonnes of battery-grade lithium carbonate per year.
Lithium with purity ratings above 99% found in hard rock deposits is used in batteries for everything from cellphones to hybrid vehicles.
Promotors of lithium in green vehicles suffered a setback earlier this month after General Motors decided to replace the lithium-ion stop-start battery in its popular Malibu mid-size sedan with lead-acid technology.
